Those endearing Gadiantons, the rebels for “social justice” or “agrarian reform” so beloved by the media (think Che Guevara, Fidel, Mao, Arafat), the strong and caring folks who just want to give the oppressed their fare share, tend to become a little less endearing once they gain power and squash opposition with blood and horror.
Russia, one of the world’s most fascinating nations with some of the most amazing and courageous people, is also one of the most dangerous due to the reign of organized crime. One friend of mine in the US was involved in a business that had two Russian partners. One came from a wealthy family and was able to invest with family funds. The other was not so lucky and had to get a loan inside of Russia – a loan from the local Big Boyz. When the returns from this potentially promising business did not meet expectations, the Boyz viewed this as a financial crisis that required direct intervention. The guy who was behind in his loan had an unfortunate automobile accident that left him decapitated. Then the mafia visited the surviving partner and explained what he needed to do. They handed him a document that signed over the entire business to them and agreed that he would not compete. No chance to negotiate – accept the terms or suffer the consequences. He signed, lost his business, and fled to Canada. Chilling.
When Gadiantons rule, they dictate the terms and take what they want. No negotiation. It’s the system, a powerful and proven system, one you don’t mess with unless you want to get hurt. You gotta have confidence in the system – or else.
What always amazes me in the Book of Mormon is the audacity of the organized robbers and their compatriots such as the Kingmen, who dare to speak as if they are the good guys just fighting for the rights and welfare of the people, as if the System (the Gadianton ways) is good and noble, something the people should be glad to succumb to. After all, giving in is for their own good. This is the criminally insane mentality that could rob someone in broad daylight and say that he was doing it for the good of the victim, just trying to help. And when they do something blatant, like seizing a whole industry or burning down a village, they often publicly “regret” their actions, but explain that they were “forced” to do whatever crime they committed for the sake of the people, or for the good of the “system.” Very scary – and the more power they get, the scarier and bloodier they become.
The rise of powerful “secret combinations” of greedy and elite gangsters in the Book of Mormon is what ultimately brought down two great civilizations. Chaos and bloodshed resulted from their insane appetites for power and wealth. The Book of Mormon warns us, in our day, to watch out for these things, and boldly states that they are had among all nations and will be operating here, seeking to overthrow freedom. We ought to care. They are difficult to detect in their early stages, but eventually the mask of compassion comes off and we get a glimpse of brutal reality – about the time it is almost too late to resist.
When I heard the Russian story about one year ago, I shook my head and said, “Thank goodness I’m in America, a free country.”
So, uh, speaking of America, did you catch the news yesterday? No, not the Madonna news, but something perhaps even more interesting – especially for people who take the Book of Mormon seriously and understand its prophetic warnings for our time (e.g., in Helaman, Third Nephi, Ether, and a touch of Alma).
Here is the opening section of the Associated Press story by Martin Crutsinger, Oct. 14, 2008:
Government moves again to unclog credit lines
WASHINGTON (AP) — President Bush on Tuesday announced a $250 billion plan by the government to directly buy shares in the nation’s leading banks, saying the drastic steps were “not intended to take over the free market but to preserve it.”
Nine major banks will participate initially including all of the country’s largest institutions, he announced, in a move that sent stocks soaring on Wall Street.
Some of the nation’s largest banks had to be pressured to participate by Treasury Secretary Henry Paulson, who wanted healthy institutions that did not necessarily need capital from the government to go first as a way of removing any stigma that might be associated with banks getting bailouts.
“We regret having to take these actions,” Paulson said. “Today’s actions are not what we ever wanted to do — but today’s actions are what we must do to restore confidence to our financial system.” . . .
Under the new multifaceted stabilization program described Tuesday, the government will initially buy stocks in nine major U.S. banks. When financial markets stabilize and recover, the banks are expected to buy the stock back from the government, Bush said in brief remarks from the White House Rose Garden.
“These efforts are designed to directly benefit the American people by stabilizing the financial system and helping the economy recover,” he said.
Paulson told a Treasury Department news conference that the aggressive government intervention was “what we must do to restore confidence in our financial system.”
A related perspective comes from the following excerpt from the Wall Street Journal‘s story, “At Moment of Truth, U.S. Forced Big Bankers to Blink” (but I think “truth” and “blink” aren’t the right words).
WASHINGTON — On one side of the table sat Treasury Secretary Henry Paulson, flanked by Federal Reserve Chairman Ben Bernanke and Federal Deposit Insurance Corp. Chairman Sheila Bair.
On the other side sat the nation’s top bank executives, who had flown in from around the country, lined up in alphabetical order by bank, with Bank of America Corp. at one end of the table and Wells Fargo & Co. at another.
It was Monday afternoon at 3 p.m. at the Treasury headquarters. Messrs. Paulson and Bernanke had called one of the most important gatherings of bankers in American history. For an hour, the nine executives drank coffee and water and listened to the two men paint a dire portrait of the U.S. economy and the unfolding financial crisis. As the meeting neared a close, each banker was handed a term sheet detailing how the government would take stakes valued at a combined $125 billion in their banks, and impose new restrictions on executive pay and dividend policies.
The participants, among the nation’s best deal makers, were in a peculiar position. They weren’t allowed to negotiate. Mr. Paulson requested that each of them sign. It was for their own good and the good of the country, he said, according to a person in the room.
During the discussion, the most animated response came from Wells Fargo Chairman Richard Kovacevich, say people present. Why was this necessary? he asked. Why did the government need to buy stakes in these banks? . . .
Mr. Paulson said the public had lost confidence in the banking system. “The system needs more money, and all of you will be better off if there’s more capital in the system,” Mr. Paulson told the bankers.
After Mr. Kovacevich voiced his concerns, Mr. Paulson described the deal starkly. He told the Wells Fargo chairman he could accept the government’s money or risk going without the infusion. If the company found it needed capital later and Mr. Kovacevich couldn’t raise money privately, Mr. Paulson promised the government wouldn’t be so generous the second time around.
Hey, it’s for the good of the system. Surrender, and nobody gets hurt.
Did you catch what happened? A shakedown. Executives were forced to sell shares to the government – a step toward the ongoing nationalization of industry – and after selling at rock-bottom prices, they will be “expected” to buy them back later when the price goes up. “An offer you can’t refuse.” No one dared to – but the relatively healthy Wells Fargo CEO was justifiably shocked that he was being forced to sell when they didn’t need government help and, of course, government control. Your money has been seized — hundreds of billions of dollars — allowing the Boyz in charge to shake down other businesses, call the shots, and get even more power and ultimately more money. Nationalization of industries, massive expansion of powers – this is no longer creeping socialism. It’s a race toward virulent socialism with a vengeance, and done under the leadership of an alleged conservative President, who wants us to think that it’s necessary and for our own good. Most of us are just sitting back and taking it, no squawking.
Now, more than ever, it’s time for us to dig into the messages of the Book of Mormon meant to help us in our time of crisis. This is more than just a financial crisis we face.
Scary, Jeff.
This comes as no suprise to me. This battle (the banks trying to take America over) has been going on for years … the banks have just not been so successful on a big scale.
However, this time, it looks like they are closer than ever to accomplishing their goals.
Don it’s not the banks taking power it’s them relinquishing power, Power and rights that they have as business owners and employees. Power over their company that they have every right to.
This is what is called a hostile takeover, only it was done by the government, the very people put in power to avoid this kind of thing from happening.
The banks are the victims in other words at least in this specific case.
As Nathan said this is scary, and even terrifying to those who see what is going on.
We have a watchman on the tower that has been warning us about this for years. I just hope that I can get out of debt before it’s too late.
@Jeff
Thank you for also being a watchman on the tower, I see very few people raising a voice of warning about this and its comforting to know I’m not the only one who sees what’s going on.
You forgot one name on your list: Chavez.
Wells Fargo played the part of Jeremy Irons in The Mission. Will anyone be playing the part of De Niro?
Seeing how Joseph Smith came of age in a very unsophisticated place and time how did he manage to be so correct about a rather complex subject? Automatic writing or whatever they call it? I guess he knew which hat to stick his face in to get revelation.
Richard G
Do you think Paulson is ordering Bush around, or are both taking orders from Mr. Big, whoever that is? This stinks totally of the kind of conspiracy theories that were viewed as crazy 20 years ago, but appears to be the fruits of all the kind of manipulation and scheming with the Fed, etc.
Dear Do you think Paulson,
Good observation. My money is on Mr. Big. Everybody ought to watch the movie “The Brotherhood of the Bell.” Or maybe that should be “The Brotherhood of Yale.” It stricks me as odd that so many people in power went to Yale for it to be just a coincidence.
Richard G
Make that strikes and not stricks.
Richard G
There is a difference to what is happening in the US and the Gadianton style mob that happened in the Book of Mormon. In our (US) situation, we have elected government officials to run our country. In turn, there are government posts that are filled by appointment. The Secretary of the Treasury is trying to regulate a very complicated portion of the banking industry. In fact, it is so complicated that economically astute individuals (Warren Buffet) cannot make certain that loans based on this can actually be traced to real money. I do not subscribe to the notion that if a bank signs on or is coerced with accepting tax payer monies to be regulated a bad thing. It is my taxes that the Treasury Department are trying to get an accounting of. Now it is another argument if there were a shadow government pulling the strings of the elected officials. But the example brought up in this post I do not consider to be mafia like extortion.
Thought you might want to know that you misspelled Gadianton — only 1 d.
Jeff,
I’m clear that you’re not in favor of the bailout. Do you have a better idea, though? While I don’t have any inside information, I’ve been following this closely. What Treasury initially proposed was clearly a bad idea—most economists that I’ve read or heard, however, say that this capital injection plan is exactly what the economy needs, and is far better for taxpayers than simply buying illiquid and depreciated assets would be.
Sure, Wells Fargo and other banks objected. Their executives don’t want to have their pay limited, don’t want to give up their lightly-regulated autonomy. But they want capital, they want FDIC insurance. They want the upside, but without any downside risk. Lehman insisted that it was healthy until the day it went under. The government’s trying to protect the economy, the taxpayers, and the banks themselves. Sure, what it’s doing isn’t perfect. But it’s not bad, and it’s clearly not Gaddianton-like.
Note, as I defend Treasury’s actions, that I’m no fan of the Bush administration. But something had to be done, per every economist, finance person, attorney, and reporter I’ve spoked with or heard. But you’re the boss: what is your proposal?
Jeff has no original ideas.
He just critizices that which he knows little about.
Next on his list of “bad” guys is Mother Teresa.
Jeff, ever have an idea that was not spoon fed to you? baaaaaa
Hi All,
Back in the 1800’s there were issues with banks and the economy of the nation that President Andrew Jackson had to deal with. At that point in time the nation was highly suspicious of banks. Andrew Jackson’s approach was to let the banks fail. See his thought on the issue was that the banks had created the risky economic environment and while things were working, the banks were making money hand over fist. But when things went sour, the banks were coming to the government to bail them out. Jackson’s approach was to essentially say to the banks “you created the environment, you knew the risks, now live with the consequences of the environment you created.” End result, the banks were allowed to fail, no bail out occurred, and our nation still stands. So Sam B., an option, maybe not a great option for the banks, the legislators, Mr. Paulson, and maybe not the country in the short term, would have been to let the banks fail and let the market fall. I recognize this would have a huge short term impact on the country, but in the long term, maybe everyone would have learned an important lesson about making wise investments, voting for people interested in benefitting our country not thier pocketbooks, and not over extending themselves by taking on too much credit. In the long term, our country might have found itself stronger and wiser if we had just simply allowed our banks to suffer the consequences of engaging in the risky business they knowingly created.
Sincerely
Catholic Defender
I agree with Catholic Defenders idea, and Jeff’s message. The real way to “solve” the crisis is to let the free market do it.
The free market will regulate itself, sure people will cheat it, but that catches up to them. Look at Enron, no government intervention stopped the cheating the free market did.
Letting the banks fail will cleanse the system, hurt everyone but we’ll all be stronger for it. Plus the government won’t get larger.
Its not a pretty idea, but its the only way to properly fix the problem.
It would be inhumane for us to actually allow consequences in America. We should be able to take all the risks in the world, profit in good times and profit in bad times. It’s the American way.
Everyone should have health insurance. Everyone should drive a Porsche and live in a quarter million dollar home. Why don’t you all get the American dream?
The idea of actually working to earn things is so old fashion. This is the 21st century, for heavens sake! We don’t live in Zimbabwe, this is America.
We are rich, why? Not because we have a trade surplus. Not because we have record low unemployment. Not because our budget is balanced. And definitely not because we’ve worked hard, but because we’re big and we said so.
America is too big to fail. The dollar is too big to fail. There’s no stopping our greatness. Soon the entire world will wake up. All nations will gather together under one great power. No one will have to work! No will go hungry. The food and homes will just exist. Why? Because that’s how big, powerful and good we are.
Get your heads out of the sand! Shake off these oppressive chains and false ideas of hard work, frugality and consequence.
Obama/McCain ’08
USSA
In all seriousness now, how can anyone possibly believe the bailout is/was a good idea? I can only imagine those people don’t fully understand the consequences of such action.
Let’s investigate how the government actually gets money to pay for such projects.
1) Taxes
2) Debt (Borrowing it)
3) Printing it
The least painful way of paying for this bailout would be option number one–immediately raise taxes $850 billion. But let’s be honest, how many politicians are actually going to do that? None of them, they would never be reelected.
They must be more inconspicuous.
Option number two is immoral, forcing future generations not only to foot the bill of the $850 billion but also the countless billions in interest. Eventually taxes will have to be raised or option three has to be employed. It just postpones and intensifies the blow when it finally comes.
Option three is the sneakiest of them all. No one has to give up any of their physical dollars. But what happens when you throw truckloads of new money into a system? What actually happens with Bernanke’s helicopter? Inflation. In our case, most likely, hyper-inflation. The wealthy are at an advantage because they are the one’s who get to spend the new money first before the price of goods rise. The lower class are robbed as their incomes remains the same and all their bills increase rapidly. Think of those who are retired and on fixed incomes. People who have been thrifty and saved are robbed as their savings are diluted into worth-less pieces of paper. The middle class is wiped out and there is a great divide between the super-rich and the poor.
Inflation is how we got into this mess to begin with, and now they’re trying to sell us a solution of more inflation. “We can fix the problem now, we just need a little more power [and doing so strip you of your liberties].” What’s Einstein’s definition of insanity again? Have we not had enough examples of countries who have tried to print their way out of a financial mess?
Hello! They called it a housing bubble for a reason! The prices were inflated. Now the prices must fall because their is too many houses and not enough demand, yet Uncle Same says no.
All three cases represent a socialist distribution of wealth. In this situation it’s not even a “noble” distribution of wealth to the poor. All three cases are unconstitutional. Our federal government has no authority to take such action.
Undoubtedly the best solution would have been to bite the bullet (it would have been a lot easier if we would have done it the first time around in 2002). It’s the only solution that will work. Yet our government refuses to let that happen. Eventually the dollar will become worthless and the government will not be able to print their way out. The crisis will likely last the better part of a decade instead of a quick year.
Remember it took a financial catastrophe for Hitler to get into power. Can anyone say anti-Christ?
Our government does not have any money. The only money they have is that which they steal. Our country is broke. In 32 years the national debt will be $52 trillion dollars due to social security, medicaid, and medicare alone. Every year we do not reform those programs (I say get rid of ’em), that $52 trillion goes up $1 trillion. Note, those numbers were figured before all this bailout business, it will likely be much higher.
One more note on inflation: If you think the cost of gas has gone up in the past twenty or so years, you are wrong. If you price gas in gold it has remained steady for the past twenty years, at least. What has really happened is the dollar is getting weaker and weaker. But you don’t hear the presidential candidates debating our dependence on inflation.
What is missed is the Wells Fargo deal. I know the folks over there…they stayed away from sub-prime for the most part. It means they are now flush compared to others and ought to reap the benefits. Instead they are being treated as the enemy by govt.
Look into the Wachovia deal. The FDIC tried to arrange a quick sale to Citi for $2BB. Wells said “hey, we’ll buy it for $15BB” – and now Citi plans to sue the pants off of Wells. Clearly the govt is trying to work deals that favor someone behind the scenes. Big, big trouble ahead.
Thomas Jefferson can speak for himself on this too:
“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.”
I say, “thank you, Jeff” for pointing out the very real problems–and asking questions–
on most “mainstream” LDS sites right now there are great debates between whether Obama or McCain is most “humorous”–
*rolling my eyes*
this is nothing more “real” to such as the sort of rivalry that exists between football teams–
Believing in the shadow government, I think it’s a shame that Obama and McCain hob-nob at gala dinners . . . and laugh at each other and have such friendly chats (hey, why can’t Norman Mormon figure out that they ARE in the same camp?) and who is listening to the REAL heroes–
such as Ron Paul . . .
*sigh*
and I’m tired of hearing the “lesser of two evils” argument, too–
the first presidency message, in fact, states that there are “truths” in VARIOUS parties; someone THERE has intelligently considered that maybe the two party system is, actually, flawed–
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I have to confer with you Jeff. Today’s Gadianton robbers are getting away with whatever they can.
If memory serves correct, the Fabian socialists formed a society in Britain in the late 19th century. Their strategy was termed “creeping” socialism or “gradualism” so as not to make others aware.
Given recent events, like those at Mises.org, I think this was the most “brazen” attempt at socialism we have seen since the 1930’s.
The parallels you point out between the Gadianton robbers and the “kingmen” are very appropriate.
Perhaps if we can “flood” the earth with the Book of Mormon, perhaps more people will understand just how important that book is to the problems facing society and the only way we can be extricated from them.
Thanks for the post.
Greg
BelieveAllThings.com
So, I’m curious….did the Wells Fargo guy sign? What was the outcome?
That’s a real nice bank you got there. It’d be a shame if anything were to ever happen to it…